Sunday morning is not a time we choose to watch TV but yesterdays interview with the Prime Minster was pretty extraordinary
Interviewed by Andrew Marr he admitted that the government had been warned of the HGV driver shortage months ago and chosen to do nothing. When asked about the impact of a shortage of butchers risking a mass slaughter and incineration of 100000 pigs the best he could come up with is that they were going to die anyway!. Leaving aside the fact farmers will not get paid the idea its OK to pointlessly raise and kill so many animals seemed to pass him by.
You see its all part of the master-plan to reap the Benefits of Brexit
These are just bumps in the road as we adjust to becoming a high pay high productivity economy
Those who are of a certain age will remember the catch phrase of the comedian and magician Tommy Cooper who always finished a trick saying "just like that" He came to mind during the interview as the Prime Minister said it wasn't governments job to ensure shelves were full and petrol delivered despite the fact that the restrictions imposed post Brexit and the immigration rules implemented by the government have ensured all the supply issues in the UK are much worse than the rest of Europe as the result of his policies. The move to a high wage high productivity economy will happen " just like that"
You see its all industries fault, Its their job to find ways around the obstacles that the government has erected. All they need to do is increase wages and train people and the problem goes away. No role for the state to improve educational skills. No re-looking at immigration rule ( well not unless Christmas supplies are at risk). No its all down to business
We want to believe there is a plan but we just don't. Inflation is forecast to continue to rise at least in the short-term to over 4% . Most public sector workers are getting no pay increases this year. Nurses will see their income after inflation fall this year. The hope that inflation will subside rests on the belief that all the pay rises that the government keeps encouraging will not be passed on to the end consumer. Otherwise price increases will soon consume the higher pay
It is clear the pandemic has had a huge impact upon the UK economy. After the recent tax increases announced in the last budget and subsequent increases in National Insurance the government is taking a higher proportion of national income in tax than at any time since the second world war. That need not be a problem whilst interest stay low since debt interest is so low. If inflation takes off and rates rise things will get really tricky
High wage/ low inflation economies are successful because they have high productivity . Productivity in the UK has been pretty stagnant for the past decade
The government is taking a huge risk in allowing shortages to drive up wages in the hope this will force increases in productivity to pay for them without an increase in prices. as part of a re-balancing of the economy . Mrs Thatcher did something similar when we closed heavy industry and moved to services. Arguably her government was more competent , certainly better led the the current shower and they still blighted communities across the North for a generation as a result of their policies
Next time you join a queue or look at empty shelves you can console yourself with the knowledge its part of a grand plan
And if it all ends in tears we have been warned it will be industry not government to blame!